Djibouti
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Djibouti occupies a strategic geographic location at the mouth of the Red Sea and serves as an important transshipment location for goods entering and leaving the east African highlands. The present leadership favors close ties to France, which maintains a significant military presence in the country, but also has strong ties with the US. Djibouti hosts the only US military base in sub-Saharan Africa and is a front-line state in the global war on terrorism. The economy is based on service activities connected with the country's strategic location and status as a free trade zone in the Horn of Africa. Two-thirds of Djibouti's inhabitants live in the capital city; the remainder are mostly nomadic herders. Scanty rainfall limits crop production to fruits and vegetables, and most food must be imported. Djibouti provides services as both a transit port for the region and an international transshipment and refueling center. Imports and exports from landlocked neighbor Ethiopia represent 85% of port activity at Djibouti's container terminal. Djibouti has few natural resources and little industry. The nation is, therefore, heavily dependent on foreign assistance to help support its balance of payments and to finance development projects. An unemployment rate of nearly 60% continues to be a major problem. While inflation is not a concern, due to the fixed tie of the Djiboutian franc to the US dollar, the artificially high value of the Djiboutian franc adversely affects Djibouti's balance of payments. Per capita consumption dropped an estimated 35% between 1999 and 2006 because of recession, civil war, and a high population growth rate (including immigrants and refugees). Faced with a multitude of economic difficulties, the government has fallen in arrears on long-term external debt and has been struggling to meet the stipulations of foreign aid donors. . Source: The World Factbook, CIA. |
The
French Territory of the Afars and the Issas became Djibouti in 1977. Hassan
Gouled APTIDON installed an authoritarian one-party state and proceeded to serve
as president until 1999. Unrest among the Afars minority during the 1990s led to
a civil war that ended in 2001 following the conclusion of a peace accord
between Afar rebels and the Issa-dominated government. In 1999, Djibouti's first
multi-party presidential elections resulted in the election of Ismail Omar
GUELLEH; he was re-elected to a second and final term in 2005.